Fractional ownership of real estate opens up new opportunities for larger individual investors looking to own luxury real estate without a budget or simply for investment appreciation. for example, Alif Allows users to co-own the vacation home sort. His hBits, another Mumbai-based startup, is also working in this fractional ownership space, but with a focus on commercial real estate.
Founded in 2018 by Shiv Parekh and Samir Bhandari. h bit This will enable investors to invest in high-yield assets such as offices, warehouses and commercial spaces with ticket sizes as low as Rs 25 million. However, smaller ticket sizes aren’t the only promise hBits makes to consumers. Its suite of services includes rent collection and property maintenance, reliability with due diligence from a premier law firm, and returns of up to 8% to 10%.
The startup aims to address the issue of limited access to the lucrative asset class of commercial real estate. Traditionally, investing in commercial real estate has been primarily accessible to ultra-high net worth individuals (HNIs) and institutions, creating a barrier for ordinary investors.
How did you come up with the idea for your startup?
Shiv Parekh, founder of hBits, discovered the success of the fractional real estate model while pursuing his MBA at Harvard University. Leveraging his family’s 35 years of experience in the real estate industry in India, Germany and the United Arab Emirates, he founded hBits with the aim of enabling private investors to participate in the growth of commercial real estate. raised. Recently, we introduced his AIF fund which focuses solely on: real estate. Our idea was well-received by investors, especially family offices and high-net-worth individuals interested in real estate investing.
Please give us an overview of your setup and business model.
The platform currently manages assets worth Rs 230 million. We are a technology-driven platform and the entire process from onboarding to investing is facilitated on our portal. A customer can log in and invest within 60 seconds through our platform. After investing, customers can also track their investments on the investment dashboard.
In the fractional model, there is a fee for managing the property. In addition to the annual management fee, we will charge a success fee if a certain standard is exceeded. Our objective is for our investors to earn the maximum possible return, so only if our investors make a profit can we also make a profit.
What new features will you add to the platform?
Our advanced customer onboarding and engagement platform leverages cutting-edge algorithms to assess real estate value by analyzing key factors such as location, amenities, and market trends. This allows investors to accurately understand the potential value of their investment.
Additionally, our platform provides portfolio recommendations, scrutinizes investors’ current portfolio holdings and suggests diversification strategies to effectively reduce risk. We plan to develop multiple APIs to ensure seamless integration with third-party applications. Additionally, our platform integrates RPA (Robotic Process Automation) bots to streamline operations by increasing productivity, saving time, lowering costs, minimizing human intervention, and lowering error rates. , increasing overall efficiency.
How do you plan to expand your business in the future?
We have already set up an AIF to utilize warehouse space. The recent notification by the regulator is a very positive sign for the business as it will allow it to approach more investors. We also plan to explore other first-tier cities. The platform currently has as many as 10 properties listed for him based in Mumbai.